Pennsylvania’s MCARE Fund does not cover claims against a hospital for sexual abuse at the hands of a physician who practiced medicine there, the Commonwealth Court has ruled.

With the exception of one claim for medical malpractice, the Commonwealth Court ruled Monday that recovery under MCARE—the state’s Medical Care Availability and Reduction of Error Fund—is unavailable in a lawsuit against the hospital, Aria Health, filed by two victims of serial child molester Dr. Earl Bradley.

Aria Health had argued it is entitled to MCARE coverage for all claims because they allegedly stemmed from doctor-patient relationships between Bradley and his victims. But the court rejected the argument, ruling that allegations of sexual abuse do not involve medical liability on the hospital’s part.

Commonwealth Court Senior Judge James Gardner Colins wrote that in order to qualify for MCARE defense or indemnity, a health care provider must be part of an action alleging faulty medical care.

“Sexual assaults perpetrated by a physician during the course of medical care as a matter of law do not constitute the furnishing of health care services,” Colins said, adding that the court found that claims alleging the hospital failed to report misconduct and for vicarious liability were not covered by MCARE.

Bradley, a former Lewes, Del., pediatrician, was convicted in June 2011 of rape, second-degree assault and sexual exploitation of children. He was sentenced to 14 consecutive life terms plus 164 years. Bradley filed a motion for post-conviction relief earlier this year with Delaware Superior Court Judge William C. Carpenter Jr.

In Aria Health v. Medical Care Availability and Reduction of Error Fund, the defendants in the underlying litigation, the hospital and Aria Health Physician Services (AHPS) petitioned the court for coverage in personal injury suits brought by plaintiffs listed as A.H. and G.H.

The plaintiffs, who were patients of Bradley’s in the 1990s, claimed that the hospital and AHPS were vicariously liable for Bradley’s assaults as well as violating their duties to patients by retaining Bradley and failing to monitor the care he was providing, according to Colins.

Additionally, A.H. asserted that the defendants were negligent in failing to report Bradley’s misconduct, Colins said.

The MCARE Fund denied AHPS coverage, determining that it was not a qualified entity under the act. The hospital was also denied coverage because the fund concluded that the claims against it did not constitute medical professional liability, Colins said.

The defendants petitioned the court to review the case, seeking to reverse the denial of coverage.

Regarding AHPS, Colins said that the entity did not show, nor did it claim, that it was a “health care provider,” the first qualification needed for MCARE coverage.

Therefore, Colins said, “AHPS is not on this record entitled to judgment in its favor, regardless of whether the claims against it are ‘medical professional liability claims.’”

As for the hospital, Colins said that while the facility qualifies as a health care provider, the claims against it made by A.H. do not fall under the category of medical malpractice.

“Because there is no claim in the A.H. action that [the] hospital provided any treatment to the plaintiff other than vicariously through Dr. Bradley,” Colins said, “the claims against [the] hospital in that action do not satisfy the requirement that they arise directly from the furnishing of health care services and therefore cannot constitute ‘medical professional liability claims’ covered by the MCARE Act, regardless of what duties A.H. alleges that [the] hospital breached.”

The G.H. complaint, however, did make claims that medical treatment was provided by the hospital, Colins said.

The alleged negligence lies in the hospital’s credentialing and retention of Bradley, its failure to chaperone Bradley’s treatment, maintain safe facilities and promote procedures and rules to ensure quality care and safety, Colins said.

Particularly, G.H. claimed the hospital’s policy discouraging parents from being present while their children are treated violated pediatric care standards, according to Colins.

“The claim that [the] hospital breached pediatric medical standards in [the] health care that it provided asserts a claim of failure to exercise professional medically related judgment and is therefore a ‘medical professional liability claim’ covered by the MCARE Act,” Colins said.

In terms of the hospital’s contention that it should be covered for the credentialing and retaining of Bradley—G.H. specifically maintains that the hospital failed to perform background checks—Colins said that since that particular claim did not assert any failure to exercise medical judgment, it was not covered under MCARE.

Blue Bell, Pa.-based Elliott Greenleaf attorney John Elliott represented AHPS and the hospital and did not return a call seeking comment.

Elit R. Felix II of Margolis Edelstein in Philadelphia represented the MCARE Fund and did not return a call seeking comment.

Rosanne Placey, press secretary for the Pennsylvania Insurance Department, declined to comment.

P.J. D’Annunzio can be contacted at 215-557-2315 or pdannunzio@alm.com. Follow him on Twitter @PJDAnnunzioTLI.

(Copies of the 22-page opinion in Aria Health v. Medical Care Availability and Reduction of Error Fund, PICS No. 14-0478, are available from The Legal Intelligencer. Please call the Pennsylvania Instant Case Service at 800-276-PICS to order or for information.) •